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Succession of Theriot

Court of Appeals of Louisiana, Third Circuit

May 17, 2017

SUCCESSION OF JOHN PATRICK THERIOT, JR., ET AL.

         APPEAL FROM THE SIXTEENTH JUDICIAL DISTRICT COURT PARISH OF ST. MARTIN, NO. 15421 HONORABLE KEITH R. J. COMEAUX, DISTRICT JUDGE

          Alan K. Breaud Timothy W. Basden Breaud & Meyers COUNSEL FOR OTHER APPELLANT: Kathryn H. Theriot

          Paul Philip Breaux, Jr. Breaux & Hornstein, LLC COUNSEL FOR OTHER APPELLEE: Lynn Jordan

          Porteus R. Burke Joseph Burke Burke & Cestia COUNSEL FOR OTHER APPELLEE: Pat Theriot Trust

          Allan L. Durand In Proper Person COUNSEL FOR OTHER APPELLANT: Allan Durand, Executor

          Edmond L. Guidry, Jr. Attorney at Law COUNSEL FOR OTHER APPELLANT: Allan Durand, Executor

          Mark N. Mallery Jacob C. Credeur Ogletree, Deakins, Nash, Smoak & Stewart, P.C. COUNSEL FOR OTHER APPELLANT: State Farm Mutual Auto Ins. Co.

          Court composed of John D. Saunders, Phyllis M. Keaty, and John E. Conery, Judges.

          SAUNDERS, Judge.

         These appeals arise from a dispute over the correct recipient of a decedent's initial termination and extended termination payments from his employment as an insurance agent. The trial court found that the corporate agent was the correct recipient of the initial termination payments while no party had shown it was eligible for the extended termination payments. The executor of the estate, the insurance agency, and the decedent's wife have all appealed.

         FACTS AND PROCEDURAL HISTORY:

         Pat Theriot (the decedent) worked as an insurance agent for State Farm Mutual Automobile Insurance Company (State Farm) since 1981. In 1994, the decedent formed a corporation named Pat Theriot Insurance Agency, Inc. (the corporation). The decedent was the sole shareholder and served as President while the corporation was referred to as the agent of State Farm. The 1994 Agreement provided for sixty monthly termination payments to start when it was terminated. These are known as the initial termination payments. Extended termination payments would begin on the 61st month after termination of the 1994 Agreement and would continue until the month of the decedent's death. A joint and survivor option could replace the applicable terms for entitlement to these extended termination payments by amendment prior to the decedent's death.

         The decedent had been married three times prior to meeting his wife at the time of his death, Kathryn Hempel Theriot (Ms. Theriot). The decedent had several children from his previous marriages, all of whom are adults at the time of these suits. The decedent and Ms. Theriot were married on October 10, 2012. In the summer of 2013, the decedent's failing health was evident, and he was given three months to live. The decedent passed away on September 6, 2013.

         Prior to his death, the decedent met with his attorney, Allan Durand, whom he named as executor of his estate (the Executor). The decedent named Mr. Durand the Executor in his last will and testament. The decedent revised his previously prepared testament to include provisions for Ms. Theriot.

         In the decedent's Last Will and Testament and codicil that were executed on August 2, 2013, and September 3, 2013, respectively, the following provision at the heart of this dispute states, "3.2(B) Any termination payment due to me or my estate from State Farm shall go to my wife, Kathy." The residuary estate, except for a bequest to the decedent's sister not relevant to these proceedings, was to be left in trust for the decedent's children. This trust was also made the beneficiary of the decedent's life insurance proceeds.

         The decedent also contacted State Farm to sign additional paperwork in order for both the initial and extended termination payments would go to Ms. Theriot. Jarrod Landry, a representative of State Farm's from the Dallas regional office, brought documents for the decedent to sign to ensure Ms. Theriot would receive the termination payments.

         The decedent signed all of the documents provided to him during this meeting on August 28 (the August 28th Documents). The decedent entered into the early notification program, under which a State Farm Agent may give advance notice of retirement and be immediately eligible to assign the termination payments. These documents provided that the decedent would retire no later than August 31, 2014, qualified the decedent for the extended termination payments, qualified the decedent to receive a reduced extended termination payment for the rest of his life in exchange for the reduced extended termination payments to continue for the rest of Ms. Theriot's life, and assigned all of the corporation's rights to the extended termination payments to the decedent. State Farm asked the decedent to delay his retirement date. The decedent passed away the following week on September 6, 2013.

         On November 22, 2013, the executor filed a petition for partial possession and/or interim allowance seeking to recognize Ms. Theriot as the recipient of the termination payments. The trust responded that, as residual legatee and owner of the corporation, it was entitled to the termination payments because they were owed to the corporation.

         After learning there was a dispute between Ms. Theriot and the trust, State Farm filed a concursus petition as an intervenor. The executor had previously filed a separate petition against State Farm. The trust and Ms. Theriot both answered the concursus asserting claims to the initial termination payments. Ms. Theriot additionally filed a petition for intervention into the succession proceeding seeking to be recognized as the proper recipient of the termination payments. State Farm's concursus petition was eventually denied and dismissed after a trial was held determining the proper party to receive the termination payments.

         The executor filed a petition for reformation of contracts seeking to reform the August 28th documents to reflect the joint intent of the parties and also praying for relief on the alternative ground that the decedent relied on Jarrod Landry's assurance to the decedent that the August 28th documents would successfully transfer the termination payments to Ms. Theriot. A supplemental and amended petition for reformation of contracts was subsequently filed.

         The trust filed a motion for summary judgment seeking to be declared the owner of the termination payments. This motion was opposed by Ms. Theriot and the executor. The trial court denied this motion.

         Ms. Theriot filed a motion for summary judgment seeking to have the trial court find that she was entitled to the termination payments. Her motion was denied as well.

         Prior to trial, the trust filed a motion in limine to exclude all parol evidence from trial, which was opposed by Ms. Theriot and the executor. The motion in limine was granted, and the trial court ordered the exclusion of all evidence concerning the circumstances surrounding the drafting of the decedent's last will and testament and the execution of the August 28th documents. A motion for reconsideration was also filed and denied.

         The case went to trial. On May 5, 2015, the trial court dismissed the executor's petition for reformation, denied relief for detrimental reliance, ruled that under the decedent's will, the initial termination payments should go to the trust via its ownership of the corporation. Further, the trial court ruled that the extended termination payments were not owed to anyone because the extended termination payments were not owed to the decedent at the time of his death and were not payable under the August 28th documents since the decedent passed away before the retirement date specified in the early notification program enrollment document.

         The executor filed a timely motion for new trial which was denied. The trial court signed an order granting State Farm's suspensive appeal. The trial court then signed an order granting the executor's devolutive appeal. Ms. Theriot was also granted a devolutive appeal by the trial court.

         Next, the trial court signed an order granting State Farm's devolutive appeal of the separate judgment denying and dismissing its petition-in-intervention for concursus. Thereafter, the trial court signed an order consolidating the appeals filed by the executor, Ms. Theriot, and both appeals filed by State Farm. This court then issued an order stating that the trial court erred in consolidating appeals and ordered separate appeals. Those separate appeals were then consolidated by this court.

         KATHRYN THERIOT'S ASSIGNMENTS OF ERROR:

1. The trial court erred as a matter of law in refusing to consider "all competent evidence" in the interpretation of the Last Will and Testament of Pat Theriot.
2. The trial court erred as a matter of law in its refusal to admit parol evidence, or any evidence at all, on the Petition to Reform Contracts.
3. The trial court erred as a matter of law in its ruling that the State Farm initial termination payments were payable to the Pat Theriot Trust under the language of the Last Will and Testament of Pat Theriot.
4. The trial court erred as a matter of law in its ruling that State Farm had no obligation to pay extended termination payments to Kathy Theriot, as Pat Theriot's surviving spouse and designated beneficiary.
5. If the State Farm contract documents signed on August 28, 2013 were insufficient to assign all termination payments to Kathy Theriot, the trial court erred in failing to reform the contract documents to accomplish the stated intent of the parties at the time the documents were executed.
6. The trial court erred in failing to place Kathy Theriot in possession of both Pat Theriot's initial and extended termination benefits from State Farm.

         EXECUTOR'S ASSIGNMENTS OF ERROR:

1. The District Court was in error in failing to follow the clear language of Pat's will by ruling that Pat Theriot's bequest that "any termination payment due to me or my estate from State Farm shall go to my wife, Kathy" had no effect whatsoever.
2. The District Court was in error in ruling that it was Pat's intent that the termination payments were to be inherited by the Trust, and not by Pat's wife, Kathy.
3. The District Court was in error in refusing to admit parol evidence offered by the Executor on the issue of Pat's intent in using the phrase ". . .due to me, or my estate. . .", after having admitted parol evidence offered by other parties as to Pat's intent.
4. If the District Court was not in error in failing to give any effect to Pat's bequest of the Termination Payments to his wife, then the District Court was in error in refusing to treat the Will as an "assignment."
5. The District Court was in error in ruling that the "August 28 documents" did not result in the assignment of the Extended Termination Payments to Kathy, and in not interpreting the documents in the method most favorable to the non-drafter.
6. The District Court was in error in not reforming the August 28 contracts to reflect the intent of the parties, i.e., to assign both the Initial Termination Payments and the Extended Termination Payments to Kathy.
7. The District Court was in error in failing to allow parol evidence in support of the Petition to Reform the Contracts, and in failing to reform the contracts to reflect the intent of the parties.
8. The District Court was in error in refusing to allow parol evidence in support of the claim of detrimental reliance, and in denying the claim of detrimental reliance by Pat upon the representations of State Farm.
9. The District Court was in error in ruling that the Termination Payments should not go to Kathy, for the reason that Pat relied to his detriment on the representations of State Farm.
10. The District Court was in error in failing to admit the parol evidence that State farm accepted Pat's will as a valid transfer of ...

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